Can the Shipping Industry Change Course on Energy?

More than 150 shipping industry leaders from around the world met recently in Bonn for the UN Climate Change Conference. Gathering aboard the MS RheinFantasie river cruise ship, the participants discussed topics like alternative fuels, new technologies, and improved energy efficiency. They want to create business-focused strategies for quick decarbonization and substantial GHG reductions in their industry.

But, to borrow a phrase, it’s not going to be smooth sailing.

Shipping, along with aviation, was initially left out of the Paris accord in 2015. Currently the shipping industry emits around 1,000 metric tons of carbon dioxide annually and that figure is expected to jump significantly if left unchecked, the Guardian reported last fall.

“But the industry, which carries much of the world’s goods, is the only economic sector not now subject to any treaty on climate change, country-by-country emissions controls or reduction targets of any kind – even though it emits around 3-4% of global gas emissions and has a carbon footprint the size of Germany’s,” the Guardian’s John Vidal wrote at the time.

“To nobody’s surprise, the day-long river summit didn’t resolve any fierce policy disputes or yield unanimous decisions on how to decarbonize cargo ships,” she wrote. “But it did illuminate some steps that companies could actually take today to steer the industry onto a cleaner course while messier regulatory decisions are hashed out.”

Here are those steps, according to Gallucci:

Slow Steaming

Simply slowing down helps cargo ships conserve fuel. Generally a 10% drop in speed will reduce power demand by nearly 30%, Gallucci points out. “Unlike carbon emissions, ship speeds are relatively easy to regulate, since individual countries or economic zones can set their own limits in waters they oversee.”

Better Data and Transparency

“On many vessels, information about speed, fuel use, and location is still manually punched into computer spreadsheets and sent via maddeningly slow communications systems,” Gallucci writes. Bringing data collection into the modern era offers the ability to harness that information for shorter, better routes in favorable weather conditions. And a bunch of startups are emerging to help.

In September, Dubai-based offshore support vessel company Topaz Energy and Marine signed a deal for a new platform that promises to help Topaz route traffic and manage ships at sea.

New Financing

Retrofitting and upgrading ships is an expensive, complicated, and risky business. “Financiers should consider the risk of climate policies when pricing out their loans, which would give an advantage to cleaner projects while adding scrutiny to run-of-the-mill constructions,” Gallucci suggests. “Government and regional banks can also step in and assume some of the risk if cleaner ships lose money.”

Start Locally

Proving out technologies like batteries and biofuels, and then scaling them up in the industry won’t be an easy feat. Gallucci calls for more local demonstration projects around the world with a variety of ship types. This fall, for example, MAN Diesel and Turbo announced that a box ship had been converted to liquefied natural gas propulsion — a world first.

In Bonn, the summit participants aboard the river cruise ship came up with a briefing document summarizing the main challenges and opportunities of shipping industry decarbonization, and a list of approaches they agreed upon. The points ranged from “push for a much tighter, more robust Energy Efficiency Design Index (EEDI)” to “‘make shipping sexy’ through communication strategies.”

The participants said they plan to develop a comprehensive decarbonization action plan soon.